Positive Signs for Life After Covid in the NRV Real Estate Market

As of today, we are over a year into the pandemic. I don’t know about you, but for me that is both hard to believe on the one hand, and on the other, it feels like this last year has dragged on forever! I want to take a moment and update you on how the real estate market has fared over this past year (just a hint … very well), as well as update you on some positive stats that make me optimistic about how our local economy will fare as we begin to emerge from Covid.

Positive Signs for Life After Covid in the NRV

• Moog, Patton Logistics, Modea, Orsani and Torc Robotics are growing & will create 575 new jobs in the NRV. Click here and here to read more.

• Applications to Virginia Tech have reached an all time high at 42,000 for 2021. Read more here.

• Covid-19 Vaccinations are about to move into phase 1c, allowing more of the population access. Click here to learn more.

NRV Real Estate Market a Year after Quarantine

• New home listings dropped by over 20% last year, however buyer demand stayed high, driving average sale prices up by nearly 10%. Home values are predicted to continue to rise through 2021.

• As of April, Townside Property Management is on pace to have 100% of properties leased for 2021-2022 with less than 4% of nearly 700 properties managed yet to have leases signed. Less than 1% of rentals have asked for Covid-related rent assistance.

• The historic sellers market we have experienced over the past few years has been supercharged by Covid & low interest rates. A continued lack of housing vs. demand has kept rents rising.

Keeping You Informed About New Construction in the NRV

New Student Apartments

• The Hub Blacksburg: Located off of Patrick Henry and opening next year featuring 1-4 bed units priced at $905-$1,405/bedroom.

• Cedar Pointe: Located off S. Main near 460 featuring 1-2 bed units priced at $950-$1,180/bedroom.

• Union: Located off of University City Blvd. near Kroger featuring 424 new 1-4 bed apartments and townhomes opening in 2022.

New Construction Homes in Blacksburg

• Givens Farm: Located off of N. Main featuring 4 bed, ~2800' homes starting at $485k.

• Midtown: Located in downtown Bburg featuring 3-4 bed luxury townhomes priced between $380k-$700k+.

• Villas at North Main: Located off of N. Main featuring 3-4 bed, 2200-2900' homes priced between $385k-$490k.

New Construction Homes in Christiansburg

• Clifton: Located off of Peppers Ferry featuring 3 bed, 2300-3200' homes priced between $345k-$410k.

• Kensington: Located off Radford Rd near 81 featuring 4 bed, 2200' homes priced between $335k-$375k.

• Midway Estates: Located between C-burg & Roanoke featuring 4 bed, 1750-2000' homes priced between $250k-$275k.

What positive or negative indicators are you seeing as the local economy comes out of the pandemic?- I would love to hear your thoughts. And as always, I am happy to help if you need someone to guide you through purchasing or selling a home or investment property in the NRV!

NRV Real Estate and Covid Pt. 2: Migration from City Centers

In this, the second of a 2 part series, I want to share some research we’ve done on what we can expect in the future for the NRV real estate market based on experts’ predictions about how Covid is effecting where people choose to work and live. Click here to read Pt. 1 about the impact Covid has had on the university system specifically connected to Virginia Tech and Radford.

As I wrote in Pt. 1, when March 2020 arrived and we realized that Covid-19 was here to stay, our expectations were that the virus would finally stop the historic real estate market we have experienced. Paired with that, our assumption was that potential unemployment and uncertainty with the economy would make leasing investment properties difficult this year.

THE REALITY HAS BEEN THE EXACT OPPOSITE:

• (There have been 25% less homes for sale) + (Buyer demand has INCREASED) + (Historically Low Mortgage Rates) = a 13% INCREASE in sales prices comparing summer 2019 with summer 2020!

• At Townside, where we manage around 700 rentals, only 3 went unleased for 2020-2021.

The potential impact of Covid on where people live and work

As the onset of Covid caused offices to close, many workers who began to work from home beginning the avalanche of zoom meetings that we’ve all grown accustomed to. For a growing number of workers living in expensive city centers, the ability to work from home has opened up the possibility of living in lower cost areas that offer a more attractive pace of life. A microcosm of this was reported on the NBC Evening News which you can view in this video:

Location Independence and NRV Real Estate

When you can work anywhere, you can live anywhere.

Location independent work environments accelerated by Covid are resulting in more people to have the option to move to more affordable areas that offer a high quality of life.

This is potentially great news for the NRV! With the tens of thousands of VT and Radford grads spread out all over the country, it will only take a small percentage of them to consider moving back to the NRV and working from here to keep our housing market stable and even growing.

We already see this trend with retirees who have historically made the NRV a top location in the country to retire. This trend has the potential to accelerate if VT and Radford grads, along with anyone desiring affordable housing in a beautiful mountain setting, decide to settle here in the NRV.

What are these potential buyers looking for?

As you consider selling your home or investing in a rental targeted toward someone ‘migrating’ to the NRV, keep these amenities in mind:

• This type of buyer/renter will be looking for an updated, move in ready home

• For retiree buyers/renters, they would prioritize hassle free living where exterior maintenance is provided - such as in an HOA. Places where one can age in place with amenities like a master on main are important.

• For buyers/renters looking to work from home: a dedicated office space that is separate from the main living area. Potentially even multiple spaces that could be used for office/school.

Conclusion

Covid has turned life upside down in many ways and there will be lasting effects of the disease and the pain it has caused for some time to come. There are also impacts of covid that have accelerated trends that were already present in our culture that could have some positive effects in some arenas of life such as real estate.

Speaking purely in terms of NRV real estate, with the potential that the universities in our area will rebound as well as the desirability to live in a region that has as much to offer as ours does, there is good reason to remain positive about the long term outlook of our real estate market.

Do you know a seller who is ready to get their property listed?

Are you trying to figure out how to purchase a home in this fast paced market?

Do you want to learn how to build long term wealth through real estate?

Please get in touch. It would be my privilege to help you.

Philip Bowling, REALTOR

PhilipBowling@gmail.com

(978) 473-0587 (c)

Late Summer 2020 NRV Real Estate Market Update

Bottom Line: What do you get when you add low interest rates and continued buyer demand to a real estate market with a historically low number of homes for sale? Even higher prices with fairly priced homes selling within days (or minutes) of being listed.

Late Summer 2020 Market Stats

Here are some stats comparing the summer months last year (in a historically ‘hot’ market) with what we have seen in the same time period this year in 2020:

Number of Homes for Sale

Number of Sales YTD

Average Days on Market Before a Home Goes Under Contract

Average Increase in Sales Price for Homes Under $450k

A Note About Interest …

As a buyer, you might see these stats and think it would be wise to hold off on buying until the market cools off. Please consider two things before you do and know that I believe in the first more than the second:

1. With interest rates at historic lows (I’ve seen under 3%!!!) - and I mean historic - like never happened before historic - you might pay more for a property but end up with a lower payment because of the favorable rates. A mortgage on a $300k home at 4% would be $1145/mo. That same home priced $15k higher at $315k with a 3% mortgage would have a $1011/mo payment. Less per month for a home $15k more expensive!

2. If you decided three years ago to wait for prices to fall before purchasing you would still be waiting and a home you could have gotten for $220k then would cost you $270k today.

A mortgage on a $300k home at 4% would be $1145/mo. That same home priced $15k higher at $315k with a 3% mortgage would have a $1011/mo payment. Less per month for a home $15k more expensive!

What all this means for:

Investors:

• If you can take advantage of these low rates, it might be ok to pay market value for a property to have a property in your portfolio financed at this wicked low rate.

• With continued uncertainty due to Covid, it could be worth taking advantage of these sky high prices to sell today and have cash on the sideline ready to redeploy if the uncertainty continues and prices fall - especially starting this fall.

Sellers:

• Wait?! You are considering selling and have not listed your property yet?! Call me right now and let’s get it listed! Prices could continue to rise, however with 1. uncertainty in the future with the economy 2. historically high prices, and 3. historically low interest rates, there might not be a much better environment to sell your property in. Really, now is the time.

Buyers:

• See the note on interest rates above. This market in some ways is a win win for buyers and sellers in that you can pay a little more today and end up with a lower monthly payment because of the low rates.

• This is a market where it benefits to work with a real estate agent. When properties are moving in 3 days or less, you need to be the first to know when something is new on the market and be ready to make a good decision quickly - both of which a good agent can help you with. I get a heads up weekly both on properties that I will list but also on properties that the other 50 agents in my office have coming and can give my buyers a head start. I recently helped an investor friend put a duplex under contract that never went to market he would not have known about had it not been for our connection. I would love the chance to be that connection for you, too!

Conclusion: Low interest rates still make this hot market an attractive time to buy. High prices and an uncertain economic outlook make this a great time to consider selling (get while the gettin’s good). You have to move fast to get a property today, but it is a market where there are truly wins for buyers and sellers.

Do you know a seller who is ready to get their property listed?

Are you trying to figure out how to purchase a home in this fast paced market?

Do you want to learn how to build long term wealth through real estate?

Please get in touch. It would be my privilege to help you out.

Philip Bowling, REALTOR

PhilipBowling@gmail.com

(978) 473-0587 (c)

*Data comes from statistics pulled from InfoSparks, a service provided by the NRVAR.

May 2020 NRV Real Estate Market - Everything's Changed, Everything's the Same

As I am writing this post, states across the US are beginning to slowly reopen after being shut down by Covid-19. While the shut down has affected the real estate market in the NRV, it is not necessarily how you might expect. Read on to get a market snapshot for the area as well as a few takeaways on how this might affect buyers, sellers, and investors.

Bottom Line: The low number of houses on the market has gotten even lower as sellers have decided not to list because of the uncertain economic outlook. This has increased buyer demand even more, driving prices higher and selling the few homes on the market that are priced well quickly.

Market Data

Active Listings for Sale

Number of Sales YTD

Average Days on the Market

Avg Increase in % Sales Price for Homes Under $450k

As you can see from the data above*, sellers have become wary of selling resulting in fewer listings. However, with continued buyer demand these fewer listings are selling in less days on the market for higher prices than they were at this time last year in a historically hot market!

What does this mean for:

Sellers

• Now is a good time to sell. There are buyers hungry for homes and investments in the New River Valley and, at least for right now, you will be listing at a market high with less competition than is typical for a spring/summer market.

• Depending on what changes with the local universities, offices transitioning to work from home environments, and how the economic recovery pans out there is a chance we will see a market decline in the next year making now potentially the best time to consider a sell if that is something you might consider in the next 1-3 years.

Buyers

• If you are waiting for the market to drop due to Covid-19, you will have to wait longer. Indications are that current market conditions will continue through this summer because of continued high buyer demand connected to the growth of the area. The decreased inventory has only increased this demand as there are fewer sellers deciding not to list than buyers deciding not to buy.

• Make sure you are pre-approved with a local lender. Lending restrictions have become more strict in the past couple of months so make sure you will be able to qualify for financing.

Investors

• Risk breeds opportunity. We have not seen a softening of the undergraduate housing market as of yet - properties on the bus line next to the university are still moving quickly for high prices. However, if there is an indication of a change this fall, buying opportunities might present themselves as uncertainty scares some parents and investors out of the market. Have cash and financing ready to go.

• There are currently opportunities to purchase cash flowing homes/townhouses in Christiansburg and Radford. There are two properties in particular I have been watching that I believe would make sound investments. The NRV is still growing and the demand for affordable housing is still there outside of the university market.

Conclusion: For now, even though it feels like everything has changed, in many ways the market has stayed the same: homes moving for close to list price very quickly. Will this last? It is hard to say. More information from Virginia Tech and Radford about their future plans as well as whether or not Covid-19 remerges with a vengeance later in the year have the potential to dramatically impact the market this fall and beyond.

Do you know a seller who is ready to get their property listed?

Are you trying to figure out how to purchase a home in this fast paced market?

Do you want to learn how to build long term wealth through real estate?

Please get in touch. It would be my privilege to help you out.

Philip Bowling, REALTOR

PhilipBowling@gmail.com

(978) 473-0587 (c)

*Data comes from statistics pulled from InfoSparks, a service provided by the NRVAR.

Looking ahead: 2020 Real Estate Market Predictions for Virginia's New River Valley / Virginia Tech

What is in store for the New River Valley, Virginia Tech, and Radford real estate markets in 2020?

Whether you are an investor looking to buy or sell, a VT parent looking for student housing, or a NRV resident looking to get into a new home, you are probably wondering, “What is the market going to do in 2020?” Have we seen the top of the real estate bubble or will the seller’s market we have experienced this past few years continue? After researching local & national stats and consulting with local experts, here is a sense of what you can expect in the year to come in the New River Valley’s real estate market in 2020.

The Bottom Line: Low mortgage rates, a growing economy, and lack of properties for sale will see home prices continue to rise in 2020 - potentially leveling off at the end of the year as new construction begins to even out buyer demand.

Key Stats comparing year end 2018 and 2019 in the NRV:

• 7.4% decline in the number of properties listed for sale

• 4.8% increase in the number of closed sales

• 15.9% decrease in the days a property is on the market for sale before it goes under contract

• 4.5% increase in sale price

• What this means: There are less homes for sale, but the properties that go on the market are selling for higher prices in less time.

“We expect about one in four offers to face bidding wars in 2020 compared to only one in 10 in 2019,” - Fairweather.

What is causing this trend:

• The NRV is growing. The economy is healthy. Virginia Tech is enrolling more students and creating more jobs both at the university and ever-expanding Corporate Research Center.

• Investors who have ridden the market all the way up are looking for stable markets to invest their nest eggs.

• Parents of college students, worried that their child might not have housing, are competing for the few properties that are available.

New developments on the horizon in the NRV:

• Area homebuilders are hard at work with new construction in the area. Predictions are that new inventory coming on the market starting later this year will start to even out what has been a very strong seller’s market.

What this means for …

… Property Owners (especially around Virginia Tech campus):

• Expect the value of your property to continue to increase through the year

• No one can time the market, but do not be surprised if values peak later this year with the new inventory hitting the market.

• Conclusion: Now is a good time to sell to take advantage of a spring market with historically low inventory.

… Home Buyers:

• Even with elevated property prices, continued low interest rates could make now a good time to buy.

• Know your goals. Property will continue to be valuable in the NRV and will appreciate over time. If you are buying with a longer time horizon, even if we are near the top of the market, you will still be investing in a desirable area where home price will rise over time.

• If you can wait … it could be worth waiting for new construction to come online later this year and in 2021 to see if the new inventory starts to level off prices.

… Investors

• Cash is king: with the competition to get into properties in the NRV, more investment properties are selling for cash with no home inspections than normal. If you are able, consider a cash offer that you later finance as this might give you the leverage you need to get the deal done.

• Buy for appreciation in Blacksburg. Buy for cash flow in Christiansburg and Radford. Blacksburg investment properties offer a stable environment where there will never be a lack of tenants … and you will pay for that. If you desire cash flow in the path of progress, consider investing in Christiansburg or Radford.

Conclusion: It is possible that early 2020 will be a peak time for sellers in the NRV - especially investment properties in Blacksburg and Christiansburg.

It is my pleasure to help property owners, investors, and homebuyers to buy and sell properties in the New River Valley.

I would love the chance to meet with you to help you determine what your property is worth and to talk about your home buying goals. Schedule a free, no commitment meeting with me by clicking here or give me a call anytime (978) 473-0587.